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THE THREE DAKOTAS
No, not North and South Dakota and some other place we have forgotten about. I am thinking only of North Dakota. Of course it is happening throughout the Great Plains, or as I call them, the northern plains. There is some variation because there are differences among the states. I call it The Three Dakotas but mean only North Dakota because that is where I am from, both physically and spiritually.

As for those other states in what I call the northern plains, Minnesota is the most diverse of the four. It approaches being an industrial state. At least it is from Duluth which really does have a seaport feel to it, and then swinging south and west through the Twin Cities and Rochester and then east down to where it meets Iowa and Wisconsin

The Iron Range, along with a half dozen similar areas in the United States, is mining country. The lakes country is defined by its title. While several other states have similar areas Minnesota’s “up north” must be the biggest lake country in the U.S. It is a culture by itself. No other part of Minnesota is like the lake country.

The rest of Minnesota from the far northwest where it meets North Dakota and Canada down to the South Dakota, Iowa border and all the area not previously mentioned is farm country, some of the most productive in the United States. Like “up north” if you are familiar with farm country you know what it means. If you aren’t familiar with farm country you have a lot of reading to do. Recently I heard a lady who lives in farm country but who has no connection with farming say, “These farmers. All they ever do is complain”. She knows nothing. She understands nothing about farming.

South Dakota is like Montana in the sense that both are farm country in the east and cowboy country in the west. Not the same of course. South Dakota cowboy country is mile after mile of open range until you get to the very western edge in the center of the west boundary where you bump in the beautiful and dramatic Black Hills.

Of course the Rocky Mountains of Montana with Glacier and up against Yellowstone are what most U.S. residents think of when you say the Rockies. What beauty. What drama. How great it is.

And then there is North Dakota. We call them the Killdeer Mountains and the Turtle Mountains, but really, they are at best only respectable hills.

We do call one area hills, the Pembina Hills, but they aren’t. It is a gorge, a dramatic and gorgeous gorge to be sure, but they are not hills. Skeletons from a prehistoric fish have been found in the Pembina Hills.

North Dakota along with much of our Canadian cousins was once part of the great inland prehistoric seas. Listen to that great Ian and Sylvia folk song, The Seven Seas. That is us, 100s of millions of years before we were us.

The closest we come to honesty in our naming of a variation from the plains state we are is The Badlands. That it is, and the terms the tourist bureau uses in describing them are honest. It is a place of beauty. A special place, and truth be told, more beautiful than the badlands of South Dakota, or so I think.

So, after all those qualifiers what am I talking about when I say the three Dakotas? It is this, going back about a decade in North Dakota, before the oil boom, it is what was developing in North Dakota, and to a lesser extent because of differences among the northern plains states, what is happening in the farm country of Minnesota, South Dakota and Montana. It is what is happening because of the new technology in agriculture. The technology from the satellites that direct the tilling, planting, spraying and harvesting. Those unfamiliar with farming today don’t realize how all-encompassing this technology is. It is how this technology means that even though every acre is still farmed there are fewer farms and that means there are fewer farmers and there are fewer people who make their living by accommodating the farmers directly and indirectly.

When I was twelve years old I told my dad I could drive the combine. In the best day that meant I combined 35 acres in a day. Today if I got on that combine in the best day I could combine 250 acres. Just think how many fewer farmers that means.

Today, just push a couple of buttons at the beginning of the field and take your hands off-off everything. The satellite sets the threshing numbers, the concaves, the sieves, and the speed. It steers the combine so all 40 feet of the header are full, to the last inch. As conditions change going down that cut, so too will the combines setting.

Of course when planting in the spring that same satellite set the depth and the seeding rate. Before the seeder went down the rows that same satellite set the fertilizer rates and combinations. It did the same for the sprayer each time it went down the rows.

Impressive? Well, it gives us the biggest yields possible once that great satellite in the sky that has been there since the big bang gives up the growing degree days and the rain.

To sum it up, if you move beyond the eight or so largest cities in North Dakota and now also move out of the one fourth to one third of the state that is the oil patch you see a North Dakota that has changed dramatically, and is changing completely. If that photographer from the National Geographic thought he had some pictures a decade ago wait until the middle of this century, no, maybe only another twenty five years.

There will be fewer abandoned yards left because the land will become too valuable to leave in that state. Tear the buildings down, and rip the soil back into fields.

There is a web site called Ghosts of North Dakota. It is about ghost towns and abandoned places in North Dakota. Many are not true ghost towns because there are maybe one or two houses and even a business still occupied. However, there is not much left. It is a good website. Worth the visit if you care about our great grandparents Dakota.

If the children or maybe grandchildren of the website’s author, Troy Larson, try to continue this site they may not find much interest, at least among descendants still living in North Dakota because there will be so many old places that are relatively new every six or seven miles down the road that the visits won’t be unique.

What may be interesting is every 20 miles or so there may be a “farmstead” with storage for small grains and specialty crops. That storage, because of the costs of today’s storage bins may not look like today’s farmstead.

Instead of a 5000 to 60-70000 bushel bin that is filled at harvest and then emptied as soon as a couple of weeks after harvest only to sit there empty until next year what you might see is a circular platform with five feet or so of a hard permanent circumference. In the center of that will be a large capacity unloading system. Today systems are built to unload a1000 bushel semi-trailer in as little as two and one-half minutes. As the pile grows at that speed the unloading system keeps going up, and up and up.

Around that system is tied a “tent”, actually a new high tech cover. When the system is full it looks like the biggest Native American teepee you have ever seen. The cost per bushel is a fraction of those metal granaries of today.

North Dakota will become like many of the other prairie states. Too few people in too few places. How do you provide the infrastructure to those great unpopulated distances?

I don’t mean schools. That’s easy. Make them live in the few towns, one spouse and the kids? Or, do like Australia and deliver education over the internet.

The problem is building and maintaining the roads, and other tax supported factors. Who pays when agriculture is still an important part of the economy? Maybe not the largest, but a close second.

What happens when you need a part and a technician (we used to call them mechanics)? See that helicopter off to the southwest about 10 miles? He is on the way to this field with that technician and part. Of course if the part is too big even today most implement dealers have a boom truck that comes to the field accompanying the van that is equipped with welders, torches, air wrenches, and every other tool any respectable shop has.

Some examples of what we will look like: Colorado, what is there after you move out of that Denver-Boulder-Colorado Springs metropolis? What about Nebraska? Omaha and Lincoln. Then move 20 miles either side of the Platte and there is nothing there expect some great agricultural land, part of the Great American Bread Basket, but it doesn’t take very many people given the technology of those crops to get that cheap food to the American, and world, population.

These past half dozen or so years have been the start, but it is only the start. There will be three North Dakota’. One will be the oil patch, and it will be impressive, even if you don’t agree with it. There will be substantial changes from today’s technology, but we will be important to the United States and to the world. Then there will be the eight or so larger towns.

I say eight or so, because I am not sure what role Jamestown and Devils Lake will play. I think they will have some role because of the distance between Fargo and Bismarck, and Grand Forks and Minot. Stanley will be important because of oil. Finally, because of the industrialization north, south and east of it, so too will Wahpeton, although no larger than today, and probably smaller.

Finally, there will be farm country. That will be the most dramatic economic and cultural change of the three states within North Dakota. There will be very few people. There will be great distances. There will be technological changes so great that the tech writers will write about North Dakota then just as the energy writers and economists are writing about North Dakota today.

This is my Dakota. The Dakota farm. Mile after mile of fields of wheat. Of course in the Red River Valley it meant sugarbeet fields and in smaller numbers of farmers in the northern valley more for the individual was the potato crop.

The Red River valley became the third largest potato producing area in the United States. That happened with fresh potato stock. Then when the processing potato industry became so important, especially because of potato chips, at one time if you were eating a potato chip west of the Rocky Mountains there was two chances out of three that the potato for that chip came from the Red River valley.

North Dakota lead the nation in other specialty crops. One half of the dry edible beans (baked beans and taco beans, both) were from North Dakota. North Dakota raised more sunflowers than any other state. Today it leads in pulse crops (edible peas, etc).

Time changes all things. Potatoes are still important. Simplot’s (McDonald’s supplier) largest french fry plant is in Grand Forks. However, in total while stability has returned potatoes are a much smaller percent of North Dakota acres than they were in the 1980s.

Today what has changed in North Dakota is the very large increase in acreage devoted to both corn and soybeans across the state. Corn in now a larger crop in terms of acreage than is wheat.

In 1980 it was only Cass and Richland county farmers in North Dakota who knew that was a soybean field they just drove by. Today, as with corn, it is all over the state.

What does this mean? Given the change in technology, and the resulting increases in costs, and given the changes in the crops the North Dakota of anyone more than 50 years of age is gone, and will be changed beyond recognition. It becomes less and less so every year. The social and cultural aspects of that time is gone. That time of our great grandparents is gone. It can never be recovered. We can only hope enough of that has been saved.

 

Two days ago I posted the June 2014 employment/unemployment data except South Dakota wasn’t available and I didn’t want to wait. South Dakota released their data today so I have completed the tables.

They are in the posting just below this one. Of course North Dakota, Minnesota and Montana are the same.

As for South Dakota, it is time to say a little more. North Dakota has been written about again and again as the state with the best unemployment rate and the increase in jobs, as a percentage increase has been phenomenal.

However, as I always write, the devil is in the details, and the detail is this, considering South Dakota has no gift like oil in North Dakota their unemployment rate of 3.6 % compared to North Dakotas 3 percent, and Minnesota and Montana’s rates of 4.6% in both cases is impressive. They must be doing something right, and North Dakota and the other two states should pay close attention to what they have done through “The Great Recesssion”.

Also, I showed in a recent posting that North Dakota’s job numbers grew nearly 19 percent from 2000 to 2014. In South Dakota that percentage increase from 2000 to 2014 was over 9.5 percent, about one half of its’ sister state, but again bear in mine that there has been no oil boom there.

The nation should pay attention to North Dakota, but they should pay good and close attention from a business stand point to South Dakota. If the rest of the nation had been doing as South Dakota maybe they would have called these past years “The Sort of Slow Down”. If only…If only.

 

The South Dakota data is not available yet. I am going to post this and when I can add that data I will let you know.

As for the other state listed here, first North Dakota: Unemployment is up slightly as is expected at the beginning of the summer. That is because of all the college students looking for summer jobs. The interesting statistic is that there are 11,600 more people employed in June 2014 than in June 2013.

That is a good increase, but it does also show the maturing of the oil boom. The boom is still occurring as we can see by the number of drilling rigs, etc. However, the numbers have stabilized based on the people available to work the rigs, do the fracking, etc.

As I showed in my comparison posting last week the northern plains economy is improving. North Dakota is still the “best” economy, but the other states included (Minnesota, South Dakota, and Montana) are improving, and I think at rates better than the average around the nation.

So, just look at these and see that things in the plains are continuing as we expect. What I intend to show in the near future is that the new “Great Transformation” is continuing. That is, the new agriculture technology is continuing to empty the plains. Every acre will still be farm, in fact more intensely than it has in the recent past, but it will take fewer people, both on the farms and in the towns. In less than a quarter of a century we will not recognize the plains states.

At the start of the settlement of the plains the technology of the railroad meant a town every six miles. Before the middle of this century there will only be a town every fifty miles, or so. And that’s the truth.

 

I find it interesting and frustrating when I hear news reporters talking or writing about employment. I suppose in fairness to them I have to admit it is difficult to talk about something as complicated as any sector of economics when the best most journalists have studied is one or two semesters of introductory economics. That is why most professional journals only hire writers who have studied, actually majored in the field they are writing about. That is an economic journal hires those who have studied economics and science journals are written by journalist with some kind of science major.

After all, I would have a difficult time writing about nuclear physics. Of course I wouldn’t try either, and sometimes such as when the government releases the monthly employment report that is “news” and people do want to know if unemployment increased or decreased over the past month.

So, I better be careful and not make any errors when discussing this report.

And here is the type of thing I am talking about. As we began to get deeper and deeper into this most recent economic contraction which society likes to call the Great Recession the increase in unemployment begin to slow down. Many begin to write that we were moving into a recovery. It took those who knew how unemployment counting works to point out that after people have been out of work long enough that they no longer could collect unemployment benefits many simply quit looking for work. Guess what? Those people are no longer officially unemployed. They are simply out there lost in the great statistical world. So, while the announced unemployment rate might have been reported as 9.8 percent the real rate when those no longer counted are included might have been greater than 12 percent, and those more than 2 percent additional were even more hungry than the 9.8 percent.

Beyond the personal problems of those who are not even receiving minimal help, we have to realize that makes the economic activity for the entire economy even worse than what is reported.

How much would take too much room to write about here. Just realize that because this recession has lasted longer than most it really meant that the problems were even greater and deeper than it has been in most recessions.

Of the four states I report on it is certainly Minnesota where this was the most important because it is by far the most industrial state of the four and has the largest percentage and numbers of people who moved into that nether land.

Another situation I would like to expand on is to discuss both the unemployment rate and the numbers of people employed. That is because most assume that if they hear that unemployment dropped a percent they think they can figure that out by comparing the difference in the two employment figures.

In fact, because of what I wrote about above and also because the employed figure changes can be influenced by both immigration and emigration. The history of North Dakota, especially over the past 20 years or so is a very good example of this.

North Dakota never has had a very high rate of unemployment over the past 40 to 50 years. It is not that as farming became more and more mechanized and there were not only fewer farmers but also fewer jobs in all those small towns around the state, and yet the state always had a relatively low unemployment rate. How come?

It is because unless there were severe losses of job opportunities around the nation that North Dakotans were told to move to where the jobs were, or at least should be. That was in other states. Especially Minnesota or Colorado, but even California, or Georgia, or Washington, or where ever the industrial growth was happening.

Now in the more recent past as the economy around the nation has changed the opposite has occurred. That is, North Dakota’s unemployment rate has improved, but really the percentage is not very much. For instance, we brag about it being the lowest in the nation at 2.4 percent in May of this year, but in May 2000 it was 2.6 percent. Of course in May 2010 it had increased to 3.3 percent before we really started to grow from the oil boom.

But this is what counts, from May 2000 to May 2014 the number of employed people in North Dakota had increased by nearly 20 percent. That is huge. That could come about only by people moving into the state.

Minnesota, which brags about having the lowest unemployment rate of any major MSA in Minneapolis/St. Paul barely increased the number of jobs over that same 14 year period by 5 percent.

South Dakota and Montana were both twice the percentage growth of Minnesota, but still barely over one-half of North Dakota. The United States was in the category of only about 40 percent of the growth compared of North Dakota.

All that being said, North Dakota still has the fewest number of employed people, and by quite a bit even compared to South Dakota.

So, which is the best state? Depends on your interpretation. Not so crowded in North Dakota. But not all the opportunities all around the state like Minnesota, or even South Dakota.

 

Well, the northern plains remain what is probably the best area of the country as far as unemployment being a problem is concerned.

Of course when I say that North Dakota remains the best as far as a low unemployment rate. Mostly that is because of the continuing oil expansion. It also has been because a great agricultural period that is now starting to slow down, significantly.

Minnesota has had one of the best employment improvements compared to most of the other states. Their state budget surplus is great and their unemployment rate is among the best in the U.S. South Dakota and Montana are really a little of each.

One thing about the farm states in the past is that when there were not jobs available you simply packed up and moved on to where there were jobs. Of course there were jobs in those other places then. Today, probably not, so when it is time to move on from Jamestown or Devils Lake will there be any place to go? Maybe to a limited degree Fargo and even Grand Forks for the industrial jobs. Maybe Williston, Minot, Dickinson and other towns in the Patch if there still is a demand out there at that time. Otherwise in a generation or two we will become just another state of unemployment.

In the meantime, here we are, still in the good times. North Dakota continues to lead the way in employment growth, personal income, and tax